US Fund Flows: Fixed-Income and Alternative fund flows soared in October

US funds collected $82 billion in October, which is one of their stronger showings this year and much better than their roughly $50 billion outflow in October of last year. Investors gravitated toward safety: equity funds floundered, fixed-income funds enjoyed strong inflows, and alternative fund flows soared. A toss-up presidential election and escalating conflict in the Middle East might have contributed to investors’ modest risk appetite. 

The charts below illustrate which direction the money is flowing for a variety of fund types. For a more complete analysis, download the full monthly report from Morningstar’s Adam Sabban and Ryan Jackson. 

This data was sourced from Morningstar Direct. Not a user? Get a free trial of Direct. 

Derivative-income funds pulled in a record $3.5 billion in October. JPMorgan Equity Premium Income and JPMorgan Nasdaq Equity Premium Income, the category’s two largest, led the way. That duo helped J.P. Morgan seize the derivative-income market in recent years, but flows into this space have broadened out as rival fund providers launched similar products—77 of them since the start of 2023, to be exact. 

Inflation-protected bond funds raked in more than $7 billion in October, an about-face from the outflows that shrank the category by more than 30% since the end of 2021. One fund drove most of the October reversal: Fidelity SAI Inflation-Protected Bond Index. It raked in nearly $8 billion alone. It might have benefited from concerns about the growing US national deficit, an issue the presidential election pushed to the forefront. 

Pimco, Baird, and PGIM—three fund families bound by their focus on actively managed fixed income—all cracked the top 10 in October net flows. Each firm collected between $2 billion and $3 billion during the month. Flows did not come easy for these shops in in recent years, but bond funds’ resurgence has helped them turn the tide in 2024. 

For more comprehensive analysis and commentary on US Fund Flows, download this month’s full report. Additional topics include: 

• Active/passive flows by US category group 

• Flows for the largest fund families 

• Alternative funds reach new heights in October 

Can’t get enough fund flows data? Check out Morningstar’s Ultimate Guide to Fund Flows. 

This article is adapted from the Morningstar U.S. Fund Flows report for October 2024. Download the full report here. 

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